CO129-215 - Governor Sir Bowen - 1884 [1-4] — Page 366

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In that letter the Earl of KIMBERLEY states that while of opinion that these Colonies may properly be called upon to make some contribution towards the cost of the Mail Service, he does not feel able to call upon them for such large sums as this Department assigns to them, and he adds that if Ceylon, which is the wealthiest of them, is only called upon to contribute £2,700 a year, the contributions demanded from Hongkong and the Straits Settlements should at least not exceed that amount. In reply I have to state that, in apportioning to each Colony its share of the loss on the Eastern Mail Service, the principal factors in the calculation were: (1.) The comparative length of the services required, and

(2.) The comparative amount of correspondence forwarded in each case. This principle is carried out by this Department in all similar assessments, and the following is a brief explanation of the method of making the necessary calcula-

tions.

The whole service performed by the Peninsular and Oriental Company is divided into Sections (e. g. Brindisi and Alexandria, and Suez and Galle, &c.) and the annual subsidy is allotted to these sections in proportion to the annual mileage of each Section. Oue half of the amounts so arrived at is apportioned to the United Kingdom, whilst the other half is apportioned to the various Countries and Colonies using the Sections in proportion to the number of letters forwarded on behalf of cach.

As a matter of fact, the contributions proposed for Hongkong and the Straits Settlements are larger in amount than the contribution proposed for Ceylon because the distances over which the Mails are conveyed are greater in the case of the former Colonies than in the case of the latter.

As regards Lord KIMBERLEY'S remark in Paragraph 3 that the Colonies had no voice in the settlement of the Contract with the Peninsular and Oriental Company, I have to point out that the Colonial Office, acting on behalf of the Colonies, had a strong voice in the matter, and that it was in no small degree owing to the views of the Colonial Office as to the Colonial interests that the present Contract with the Peninsular and Oriental Company was preferred.

I have, &c.,

(Signed)

HENRY FAWCETT,

The Lords Commissioners

OF HER MAJESTY'S TREASURY.

Colonial Office to Treasury.

(Copy)

SIR,

DOWNING STREET,

23rd February, 1882.

I am directed by the Earl of KIMBERLEY to acknowledge the receipt of your letter of the 4th instant forwarding copy of a letter from the General Post Office, dated the 20th October 1880, on the subject of the proposed contributions from the Eastern Colonies to meet the deficiency of postage and consequent loss to the Exchequer arising from the conveyance of the Mails under the present Contract with the Peninsular and Oriental Company.

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2.--The Postmaster General has observed in his letter that it was in no sinall degree owing to the views expressed by this Department that the present contract with the Peninsular and Oriental Company was preferred to the other tenders, but contribu- Lord KIMBERLEY wishes it to be understood that the question of a money

tion by the Eastern Colonies was not then before the Secretary of State, who was only invited to consider the relative merits of the respective tenderers in regard to the services to be performed by them, and that the Colonial Office, when it advised the Lords of the Treasury as to the present Mail Contract, had in view the require- ments of the Australian rather than the Eastern Colonies.

The latter Colonies are so well supplied with Steam-ship Services as to be practically independent of any Contract, and in the event of any future Contract being entered into for the carriage of Mails by Steamers calling at Ceylon, the Straits Settlements and Hongkong, these Colonies may possibly not require to be included in it.

3.--Lord KIMBERLEY is, however, willing to invite the Governments of the three Colonies in question to contribute each £2,500 per annum during the currency of the present Contract.

The Secretary to

THE TREASURY.

(Copy.)

No. 7817.

SIB,

I am, &c.,

(Signed)

ROBERT G. W. HERBERT.

The Treasury to the Colonial Office.

TREASURY CHAMBERS,

12th June, 1882.

The Lords Commissioners of Her Majesty's Treasury have had under their consideration your letter of the 23rd February last, on the subject of the proposed contributions from Ceylon, the Straits Settlements and Hongkong, towards the loss arising from the conveyance of mails.

It is stated in your letter that the financial view of the question was not con- sidered by the Secretary of State when the present contract was made, but that the question was presented to him entirely with respect to the character of the Service and the requirements of the Australian rather than of the Eastern Colonies.

Lord KIMBERLEY is however ready to recommend contributions from the three Colonies in question of £2,500 per annum each, in all £7,500.

1 am directed to observe that in 1878 my Lords were informed by a letter from the Colonial Office, dated 8th August, that in the opinion of the Secretary of State the maintenance of a high speed in the Mediterranean was, especially at that time, of great importance, and that it was most desirable to maintain a direct separate service between Suez and Ceylon the Straits and China, which could not be provided for except under the Tender of the Peninsular and Oriental Company.

It is obvious that efficiency and a high rate of speed can only be obtained by a corresponding expenditure.